Foreign shipowners hit by new tax on ocean freight in China

Foreign shipowners alone will have to charge a six percent value added tax from their Chinese customers, starting this August. Danish and international shipping interests are now acting.

Danish and international shipping interests are now beginning to stir for real, following a long period of uncertainty regarding the consequences of new tax laws in China, which mean that a six percent value added tax will be introduced in August on the price foreign carriers will have to charge from their customers in China. Chinese carriers are exempted from the new tax.

“So far we’ve spent a lot of time figuring out how these rules work and how to administrate them. And now it looks like the new rules discriminate, as foreign carriers have to charge the new six percent tax from their Chinese customers, while Chinese carriers don’t. Some customers might be able to offset the new tax, which makes it a matter of liquidity, but other customers might not be able to do that,” says Jacob K. Clasen, section chief at the Danish Shipowners’ Association, to ShippingWatch.

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